I'm an American who lived in the UK for a few years - I think it really depends on current company. When I'm around anyone who has lived in or currently lives in Europe I pronounce it Zed. I work with several Irish folk here so it's Zed for them and Zee for my US associates.

You guys ever heard how the name "America" came into being?
About a thousand years ago, some vikings discovered land at the other side of the ocean.
They found some natives on the beach, who started jumping and shouting when they saw this big ship. So the Viking's chief, Eric, climbed onto the railing of the ship, and also started jumping, while shouting "I'm Eric, I'm Eric". Then his foot slipped, and the shout sounded like "I'm Eric, Aaaaggghhh".

Originally posted by realblackstuff
You guys ever heard how the name "America" came into being?
About a thousand years ago, some vikings discovered land at the other side of the ocean.
They found some natives on the beach, who started jumping and shouting when they saw this big ship. So the Viking's chief, Eric, climbed onto the railing of the ship, and also started jumping, while shouting "I'm Eric, I'm Eric". Then his foot slipped, and the shout sounded like "I'm Eric, Aaaaggghhh".

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hahahaha. actually America was named after the italian cartographer Amerigo Vespucci. he was the guy who finally said that North America, Central America, and South America (what it is now) were not part of Asia as Columbus thought. or at least that was the way i was taught by my teacher. funny story nevertheless.

"Z" is never pronounced with a zed sound in any word therefore the American pronounciation would be correct when reffering to the letter in a non-mathmatical sense.
Zed is a throwback to the greek alphabet and apparently the only way for you thick-toungued Europeans to understand eachother.